Norfolk County Division of the Probate and Family Court Department

This is a State Auditor performance audit of the Norfolk County Probate and Family Court covering July 1, 2010 through September 30, 2012.

“This report details the audit objectives, scope, methodology, findings, and recommendations for the audit period, July 1, 2010 through September 30, 2012.”

Auditors checked whether the court was properly handling money, records, fee waivers, internal controls, accounts owed, old audit issues, and custodial accounts held for other people.

“The objectives of our audit were to determine (1) whether custodial account assets are current or should be transferred to the Office of the State Treasurer (OST) in accordance with state law and Trial Court policies; (2) whether NCPFC is complying with laws and regulations pertaining to the waiver of fees as well as to the type and number of cases involving waived fees; (3) whether NCPFC is complying with Chapter 647 of the Acts of 1989, An Act Relative to Improving the Internal Controls within State Agencies; (4) whether NCPFC’s case records are adequately secured and protected; (5) whether NCPFC has adequate internal controls over financial and fund management activities related to the collection, accounting, and depositing of all fees and assessments; (6) whether the court is managing accounts receivable in accordance with established guidelines; and (7) the status of the issues identified in our prior audit of NCPFC (No. 2005-1224-3O) and any other internal audits affecting the current audit objectives.”

The problems matter because poorly tracked funds can be lost, misused, stolen, or not returned to the people who are entitled to them.

“Because of the improper account maintenance, the funds contained in these accounts are at risk of fraud, theft, and abuse; potential beneficiaries cannot be properly notified about funds that they may be owed; and even when funds are returned to claimants, they may not represent the full amount to which claimants are entitled.”

For ordinary citizens, the most direct issue is whether court-held money, fee decisions, and public-facing court services are handled accurately, fairly, and with accountability.

“The Norfolk County Division of the Probate and Family Court Department (NCPFC) presides over probate and family matters falling within its territorial jurisdiction of Norfolk County.”

The court needed to do a better job tracking custodial accounts, collecting and reconciling amounts owed, limiting who handles cash, updating its internal controls, reporting shortages, and putting vendor arrangements under proper contracts.

“However, NCPFC needs to improve its controls over monitoring and reconciling accounts receivable; recording custodial accounts and disposing of old escrow accounts in accordance with the statutes; complying with Chapter 647 of the Acts of 1989 as it relates to conducting periodic risk assessments and reporting of any variances to the Office of the State Auditor; and following Trial Court protocol over public use vending machine contracts.”

The report recommends that the court review old accounts, transfer unclaimed property when required, get guidance from the Trial Court, strengthen cash and internal control procedures, report shortages, and fix vendor contracting.

“NCPFC should review the ages of all the accounts in its custody to determine which accounts should be transferred to OST as unclaimed property; it should make this review a priority.”

The dollar amounts were not trivial: auditors found more than half a million dollars in custodial accounts that were not properly maintained, including more than $436,000 that might have qualified as abandoned property.

“Custodial accounts totaling $545,256 were not being properly maintained, including $436,582 for cases that could have been eligible to be forwarded to OST as abandoned property.”

Custodial accounts are money the court holds for someone else, often because the person is a minor or cannot be found when a probate matter is settled.

“These accounts are considered assets held in trust by NCPFC and are kept in the custody of the Register of Probate.”